BRANTFORD, ONTARIO -- (Marketwire) -- 09/20/11 -- Wescast Industries Inc. (TSX: WCS.A) ("Wescast") today announced that, in connection with the previously-announced Memorandum of Understanding ("MOU") dated September 5, 2011 between Wescast and Sichuan Bohong Industry Co., Ltd. ("Bohong") regarding Bohong's proposed acquisition of 100% of the issued and outstanding capital of Wescast (the "Acquisition"), Wescast has not received from Bohong the initial C$2.0 million deposit as required under the MOU.
Under the MOU, Bohong was required to pay to Wescast the C$2.0 million deposit no later than September 19, 2011. Wescast has notified Bohong that Bohong's failure to pay this deposit in accordance with the MOU constitutes a breach of the MOU and gives Wescast the right to terminate the MOU in accordance with its terms. Wescast has not terminated the MOU (or waived this breach) but has reserved all of its rights and remedies, including the right to terminate the MOU, in these circumstances. There can be no assurances, at this time, that Bohong will pay this deposit, that the parties will enter into a definitive and binding arrangement agreement providing for the Acquisition and/or that the Acquisition will occur. The entering into of any such definitive and binding agreement would be subject to, among other things, the approval of Wescast's Board of Directors.
Wescast Industries Inc. is the world's leading supplier of cast exhaust manifolds for passenger cars and light trucks. In addition to other products, Wescast designs, casts, machines and assembles exhaust system components, primarily exhaust manifolds, turbo charger housings and integrated turbomanifolds for automotive original equipment manufacturers ("OEMs") and Tier 1 customers for the car and light truck markets in North America, Europe, Asia, Africa, South America and Australia. Wescast employs approximately 2,000 people in 7 production facilities and 5 sales and design centres in Canada, Hungary, the United States, Germany, Japan and China. Wescast also has sales and technical design representation in the United Kingdom and France. Wescast is recognized worldwide for its quality products, innovative design solutions and highly committed workforce.
Learn more at www.wescast.com.
Forward Looking Statements
The contents of this news release contain statements which, to the extent that they are not recitations of historical fact, may constitute forward-looking statements based on certain assumptions. Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Persons reading this news release are cautioned that such information may not be appropriate for other purposes. Such forward-looking statements include the statements regarding the consequences of Bohong's failure to pay the C$2 million deposit as required under the MOU, including Wescast's rights and remedies in connection therewith (including the right to terminate the MOU in accordance with its terms), the Acquisition, including the parties entering into a definitive and binding arrangement agreement and closing of the Acquisition, and may also include financial and other projections as well as statements regarding Wescast's future plans, objectives or performance for the current period and subsequent periods and regarding the markets for Wescast's products. The words "may", "would", "could", "will", "likely", "expect", "anticipate", "estimate", "intend", "plan", "forecast", "project" and "believe" or other similar words and phrases are intended to identify forward-looking statements. Persons reading this news release are cautioned that such statements are only predictions, and that Wescast's actual future results or performance may be materially different.
This information is based upon certain material factors or assumptions that were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking statements, including Wescast's perception of historical trends, current conditions, expected future developments as well as other factors we believe are appropriate in the circumstances.
Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results to differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties principally relate to the risks associated with Bohong's failure to pay the C$2 million deposit as required under the MOU, including Wescast's rights and remedies in connection therewith (including the right to terminate the MOU in accordance with its terms), the Acquisition, including the negotiation of a definitive and binding arrangement agreement, and the automotive industry and include, but are not limited to: the failure of the parties to enter into a definitive and binding arrangement agreement, the possibility that any conditions to closing of the Acquisition under any such agreement, including regulatory, shareholder and/or court approvals, may not be satisfied or waived, Wescast's operating and/or financial performance, including the effect of new accounting standards on Wescast's reported financial results, fluctuations in interest rates, changes in consumer and business confidence levels, consumers' personal debt levels, vehicle prices, the extent and nature of purchasing or leasing incentive campaigns offered by automotive manufacturers, environmental emission regulations, fuel prices and availability, the continuation and extent of outsourcing by automotive manufacturers, changes in raw material and other input costs, Wescast's ability to continue to meet customer specifications relating to product performance, cost, quality, delivery and service, industry cyclicality or seasonality, trade and/or labour issues or disruptions, customer pricing pressures, pricing concessions and cost absorptions, actual levels of program production volumes by Wescast's customers compared to original expectations, including program cancellations or delays, price reduction pressures, dependence on certain engine programs and the market success and consumer acceptance of the vehicles into which such powertrain products are installed, Wescast's relationship with and dependence on certain customers, currency exposure, failures in implementing Wescast's strategy, technological developments by Wescast's competitors and customers, government and regulatory policies and changes in the competitive environment in which Wescast operates.
Wescast does not undertake any obligation to update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this news release or to reflect the occurrence of unanticipated events, except as required by law.
Wescast Industries Inc.